If you’re like most people, when you first learned that Bitcoin and cryptocurrency had value and that anyone could mine for Bitcoin; you considered mining it yourself. Who doesn’t want to create something out of nothing? Who doesn’t want free money?
Just like the old days when people mined for gold and precious metals in the wilderness; who’s gut instinct wouldn’t be to go grab some gold while everyone has a chance to score it?
However, just like people don’t discover gold in the wilderness much anymore; mining for Bitcoins has started to become more difficult. In the beginning, people could mine for Bitcoin using a home computer and a little special equipment. They could easily make a good profit after paying for electricity and equipment. Nowadays, the cost of equipment and electricity is often too much for the average person.
Can Bitcoin Mining Turn a Realistic Profit?
As the cost of Bitcoin rises up to $8,000 per coin, more people are showing interest in mining than ever before. However, mining isn’t as simple as it once was. There are several ways to invest in Bitcoin mining. Most of them aren’t profitable. There are also many scams. Fortunately for investors though, there is one way to turn a profit.
Cloud Mining Might Not be All it’s Cracked Up to Be
Because it’s not as easy to mine for Bitcoin in your home as it used to be, many people have turned to cloud mining companies in the hopes of being able to invest in Bitcoin from a distance.
When you work with a cloud mining company, you don’t have to use your own electricity, invest in your own hardware or worry about selling hardware later if you get out of Bitcoin mining. However, most hosted mining, virtual hosted mining and leased hashing power companies are either scams or don’t yield profits for investors. This investor complained of receiving .0004 Bitcoin after investing .01.
In Home Mining
Surprisingly, the best way to earn money with Bitcoin mining is still to mine for your own coins. However, the initial investment is nothing to sneeze at.
Tech Cashhouse reviewed several Bitcoin miners ranging in price from $50 to $1600. He based his study on:
- Bitcoin being valued at $6,000 per coin,
- An average electricity rate of .13 cents USD per kilowatt hour, and
- A .5% pool fee
The only miner that turned a worthwhile profit was the Antminer S9, the most expensive miner out of the bunch.
The profit was $3,745 per year and you would break even, (on the $1600 you shelled out for the machine), within 155 days.
In addition, you could add solar and wind turbine power to your operation to possibly save on your electric bill; increasing your profits even further. However, keep in mind; though Bitcoin is a digital asset, when you mine, your profits are taxed as income.
The Antminer S7 also turned a profit. However, the profit was only $8.87 per year. The machine costs $800 and it takes over 5000 days to break even.
Pioneers Get Out Your Pans
The good news is that the gold rush is still on folks! A profit of several thousand dollars per year really isn’t bad. However, as you can see, it’s possible that the gold rush won’t last for long. Every year, the cost to mine for Bitcoin increases.
However, for every industry involved with cryptocurrency, getting in now is a great idea. We’re still on the ground floor. However, the early bird advantage might not last the decade.